3 Tips To Improving Your Accounts Payable Process

As a small business, you need to purchase supplies and items to maintain daily operations.  Many times when you purchase an item from a vendor or supplier, they send an invoice, which is a part of your accounts payable process.  The accounts payable process refers to a set of practices and policies set by a company to manage its vendor purchases.  If you do not manage your invoices well, it can result in late payments, damaged relationships, and poor cash flow.  Luckily, there are few simple tips to improving your accounts payable process.

Electronic Is The Way To Go

One of the most effective ways to improve your accounts payable process is to go paperless.  You want to try to pay all of your invoices from your vendors and suppliers electronically. It is very easy to misplace or damage a paper invoice.  With an electronic invoice, you can import it into your account software right after you receive it. If you receive a paper invoice, all you have to do is scan and upload it into your software.  Having all of your invoices in one place on your computer is an efficient way to organize.

Organize and Remind

It is critical that you come up with a system to organize your invoices so that you can pay them in a timely manner.   Keep all your invoice in one location and create an aging report that organizes based on priority and due date. You want to set up reminders for each bill so that you know to pay them on time.  Use a calendar to manage your invoices and set up alerts for each one.

Maintain Relationships

It is essential that you maintain healthy and positive relationships with all of your vendors.  Try to pay all of your invoices on time as much as possible. If you cannot pay an invoice on time, communicate with the vendor quickly so that you can come up with a solution, such as a payment plan.  If you have a good relationship with a vendor, you can get better deals on items in the future.

PL Consulting Can Help You Plan Your Budget!

PL Consulting offers a diverse range of bookkeeping and other financial services. Each of our services is customized to fit the needs of our client and his or her business plan. Our team can help you with each step of your business from organization, to budget, to financial maintenance.  We are located in Pikesville at 119 Old Court Rd Baltimore, MD 21208. Contact us at 410.764.3731 or info@plcfo.com so that we can assist you with your bookkeeping needs. Remember to stay up to date with everything PL Consulting by following us on our social media platforms via Facebook, Twitter, and Google+.